Americas Market Update 16 Mar

Bunker prices are up considerably in Americas ports, and periods of high wind gusts can delay deliveries in Zona Comun.

IMAGE: Cargo vessel in the port of Galveston. Getty Images

Changes on the day from Friday to 08.00 CDT (13.00 GMT) today:

• VLSFO prices up in Zona Comun ($36/mt), New York ($27/mt), Balboa ($21/mt) and Houston ($9/mt)
• LSMGO prices up in Houston ($77/mt), Zona Comun ($30/mt), Balboa ($27/mt) and New York ($18/mt)
• HSFO prices up in Houston ($36/mt) and Balboa ($6/mt)

Bunker prices across all key hubs have been going sharply higher with Brent in the past session, with Houston's LSMGO price making the biggest gain.

The $77/mt jump in the grade has come amid a higher-priced 150–500 mt LSMGO stem fixed at $1,185/mt.

Bunker demand in Houston has been decent, but weather disruptions have made it difficult for suppliers to keep up with delivery schedules over the past week.

HSFO requires around 8–10 days of lead time in Houston for good supplier coverage, and VLSFO and LSMGO 7–10 days, a source said.

In Argentina's Zona Comun, bunker deliveries could be delayed by high wind gusts until 18 March, a trader said. Lead times of 7-10 days are advised for VLSFO and LSMGO at the anchorage.

Brent

The front-month ICE Brent contract has gained by $2.90/bbl on the day from Friday, to trade at $101.72/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has remained well above $100/bbl as Middle East tensions flared over the weekend.

US forces hit Iranian military bases on the strategic Kharg Island over the weekend, escalating concerns over oil supplies.

Kharg Island handles “more than 80% of Iran’s oil exports,” according to ANZ Bank’s senior commodity strategist Daniel Hynes.

Elsewhere, oil loading operations have been suspended at the UAE port of Fujairah after an Iranian drone strike started a fire in the petroleum industrial zone, Reuters reported today citing two sources.

Fujairah exports about 1 million b/d of UAE’s Murban crude oil, the report added.

“Fujairah, linked to Abu Dhabi’s oilfields by pipeline and serving as a major trading point for crude and refined products, plays a crucial role in regional and global energy flows,” Hynes said.

Downward pressure:

The total number of rigs drilling for crude oil in the US rose by one to 412 units last week, according to Baker Hughes.

The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening or expected to happen in the shale sector.

By Gautamee Hazarika and Aparupa Mazumder

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